Hillary Clinton: Crypto Has Potential for “Undermining the Role of the Dollar as the Reserve Currency”
Speaking at the Bloomberg New Economy Forum in Singapore on Friday, the former Secretary of State warned nation states to pay attention.
- Secretary Clinton warned a global audience that she perceives the rise of cryptocurrencies as a threat that merits greater attention
- The US has gained influence in the geostrategic battle over bitcoin since Chinese officials decided earlier this year to take a harsher regulatory approach to cryptocurrencies
Former Secretary of State and Democratic nominee for US President, Hillary Clinton, characterized cryptocurrency as a threat while discussing competition between global powers during a panel of the Bloomberg New Economy Forum.
Speaking about the rivalry between China and democracies in North America, Europe and Australia, Clinton highlighted the rise of cryptocurrencies as being important, and as deserving of attention as artificial intelligence.
Cryptocurrency, she said, “has the potential for undermining currencies, for undermining the role of the dollar as the reserve currency, [and] for destabilizing nations.” She did not mention how or when this might occur, or which countries could be affected. The broader context was a link between the use of cryptocurrency and threats posed by “asymmetric power moves,” specifically non-state actors exploiting cyber warfare, or adversarial governments’ use of mercenary rather than conventional armed forces.
Bitcoin advocates quickly seized on the comments, although Clinton did not mention bitcoin by name. Proponents of the largest cryptocurrency have long contended that bitcoin will ultimately displace the dollar as a global reserve currency. However, the overarching narrative for bitcoin’s growth in recent years is as a store-of-value asset akin to digital gold.
Eric Peters, of One River Digital Asset Management, for example, expects that bitcoin will eventually become “way more valuable than gold,” which is currently a $10 trillion asset.
MicroStrategy CEO Michael Saylor thinks bitcoin’s market cap will reach as high as $100 trillion as it becomes “the world’s monetary index,” he explained on CNBC Friday morning in New York.
China has taken steps to clamp down on digital asset trading and ban bitcoin mining. That has led some members of Congress, such as Rep. Tom Emmer (R-Minn.) to conclude that it’s in the United States’ best interest to do the opposite.
Looking beyond bitcoin to the growing use of stablecoins, the US dollar is clearly dominant. USD-pegged stablecoins account for about $145 billion of the $147 billion worth of fiat-pegged assets currently on the market, according to Coingecko. The top-ranked non-USD stablecoin, Synthetix’s sEUR — which is pegged to the euro — has a market cap of just $117 million.
Singapore, where the Bloomberg forum was hosted, has recently been cast as a home for alternative stablecoins. The co-founder of stablecoin issuer StraitsX told Blockworks in October that he believes that non-USD-pegged stablecoins may eventually account for a majority of the global total.
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